have been through this process in a similar situation to me. My questions here are more about the financial and timing side of things than they are about what home to choose and what to look for. I have a better grasp on the latter than I do on the former.

We are a family of five buying our first home. We do not intend to have more kids. We are looking for something in the range of $140k to $200k. Our current rental is $1k a month and is a 2bdrm with no yard. We desperately need 3 bedrooms and a yard.

Our current contract is up in May 2015 and we would like to purchase at that time. By then we expect to have about $15k in cash saved up for the purchase. I also have $20k in Roth IRA funds that I could pillage without worry about taxes or penalties due to portions being contribution and the rest falling into the new home buyer exception. I really don't want to do that, though, if it can reasonably be avoided. I understand that we will end up paying PMI for not having a 20% down payment, but I think that makes more sense than pillaging my Roth IRA. We are comfortable with a monthly payment of less than $1500 including taxes. We also have extremely good credit.

My questions are:
Should I rob my IRA to fund the down payment or can I get away with the $15k in cash we have set aside?
Should we try to find another rental (potentially costing $1200 or more per month) that fits our family's needs and try to keep saving for a 20% down payment?
Should we stay in our current rental and hope the rate doesn't go up and risk my wife going insane or my kids killing each other?
Am I missing some other really important considerations here?

I realize this is probably oversimplifying a complicated and very specific situation, but I'm mostly just hoping for some advice or experiences others have had.